Posted on 01/16/2019 5:15:48 PM PST by LibWhacker
The opening exchanges of a landmark Supreme Court hearing offered hope and confusion in equal parts. By W. Blake Gray | Posted Thursday, 17-Jan-2019
Wine lovers had nobody to argue for them in the Supreme Court on Wednesday, and it seemed several times as if the justices wished enophiles had an advocate – or at least some attorney willing to defend a pro-wine shipping argument.
The Court heard one hour of arguments in Tennessee Wine & Spirits Retailers Association vs. Blair, a case that has the potential to invalidate liquor laws across the country. It might allow people in most of the country to order wine from out-of-state retailers as well as out-of-state wineries. Related stories: Impending Supreme Court Hearing Could Open Doors Friends of Supreme Court See Trouble Brewing Consumers Can Influence Courts on Wine Shipping
The case is not technically about interstate wine shipping, but that issue was clearly on the mind of several justices. It seems likely that a Tennessee law restricting liquor licenses to longtime residents of the state will be shot down.
However, it's hard to tell from the justices' questions how far their ruling will go. Even the official Supreme Court analysis blog said: "This is a hard case to handicap."
"Isn't your next business model to be the Amazon of liquor?" justice Neil Gorsuch asked Total Wine's attorney. In fact, a favorable ruling in this case could allow Amazon itself to sell liquor, and that clearly frightens the 35 states that sent an attorney to defend a Tennessee residency requirement that even Tennessee itself would not defend.
Heard on the 100th anniversary of the ratification of Prohibition, the Tennessee case (a background summary is here) is the first wine or liquor case to be heard by the Court since Granholm vs. Heald in 2005. That 5-4 decision opened much of the country to direct shipping by wineries, but left open the question of whether states can allow their own retail stores to ship to their residents while preventing other states' retailers from doing so.
Like Granholm, this case turns on a conflict between the commerce clause of the US Constitution, which forbids states from discriminating against out-of-state businesses, and the 21st Amendment, which seemingly gives states the right to regulate alcohol differently from other products.
More than one justice seemed to want Total Wine's attorney to speak about the broader implications of the case. But Total's advocate stayed stuck on the narrowest issue: whether Total (and a couple who own a much smaller shop) can keep their liquor licenses. To Daniel Posner, president of the National Association of Wine Retailers (NAWR), that was disappointing.
"The Supreme Court did not take this case just for Total Wine," Posner told Wine-Searcher. "It became clear today that Total's case was just about residency requirements. But the justices were looking for more. They were begging the Total attorney to offer up other examples of conflict with the 21st Amendment. The unfortunate thing is we didn't have anyone [on the side of wine shipping]."
Fortunately for wine lovers, the Court will have access to a number of amicus briefs that make better and more interesting cases than Total's attorney did Wednesday,
It's possible for the Court to make a narrow ruling in this case about just Tennessee's residency requirement; beverage law attorney Sean O'Leary said immediately after the hearing that that's what he expects.
But Paul Clement, a Supreme Court attorney who wrote an amicus brief for NAWR, told Wine-Searcher he feels good about a potential broad ruling in favor of loosened restrictions on wine shipping. Such a ruling would, like Granholm, force states to decide to either allow all retailers in the US to ship to their residents, or none. Some might choose none, but after Granholm, most states eventually chose all.
"I'm pretty bullish," Clement said. "I was very gratified to hear Justice Sotomayor squarely state that Granholm was not limited to producers and not hear anything to contrary. There was plenty of time for other justices to push back on that."
To win a wide ruling like Granholm, wine retailers need five votes of nine.
"From the justices that expressed sympathy for (Total) and the justices who were in the majority in Granholm, it does seem like there was a good basis to think the wine retailers will be able to count to five," Clement said.
It's hard to pick which way each justice will jump when it comes to making a decision. © Department of Justice | It's hard to pick which way each justice will jump when it comes to making a decision.
I'm not an attorney but here's how I heard their positions, as expressed by their questions.
Brett Kavanaugh: He was the only justice to specifically mention discrimination against out-of-state retailers and wholesalers. He said the 21st Amendment that repealed Prohibition was designed only to allow states to remain dry if they chose – not to allow them to discriminate against out-of-state businesses. He seems the firmest of all pro-shipping votes.
Samuel Alito: The spiritual heir to Antonin Scalia, who provided a key swing vote in Granholm, Alito was very skeptical of states' reading of the 21st Amendment, and very pro-commerce clause. "Suppose it was a grandparents' requirement: that you could not get a liquor license in Tennessee unless your grandparents were residents. Would that be a commerce clause problem?" he asked. He also seems very pro-shipping.
Sonia Sotomayor: She interrupted less than a minute into the hearing to assert that Granholm doesn't apply only to producers. Some of her later questions did not seem pro-shipping: at one point she said "we understand the advantage of having someone local" to sell alcohol. She also said she didn't see a limiting principle in the 21st Amendment, which would be bad news for out-of-state retailers. Clement is an expert and I'm not, and Clement specifically cited her first question, but I'm not as sure of her vote as he is.
Stephen Breyer: Breyer voted for winery direct shipping in Granholm. His position Wednesday was harder to discern. He quoted the Granholm ruling, written by Anthony Kennedy, several times, especially a section that reads: "The three-tier system is unquestionably legitimate ... it gives virtually complete control to states." He also mentioned the pre-Prohibition history of alcohol regulation by states. "The history favors the other side," Breyer told the Total attorney, even though, he added: "Not all law makes much sense."
Ruth Bader Ginsburg: She was not on the bench Wednesday as she recovers from surgery, but she will read the transcripts of the arguments and vote. She voted for winery direct shipping in Granholm.
Elena Kagan: At one point she told the Total attorney: "I'm trying to figure out how we're going to write an opinion. When the next case comes along and says: 'We don't like this brick-and-mortar requirement and we don't want to have any physical presence at all' .. and they make the same argument you're making...", which she seemed to think might be a bad thing. But she also said: "Why would some kinds of discrimination be permissible and others not?" and "When you are attempting to promote economic protectionism, the sky's the limit. The more you can regulate, the more protectionist you get." Kagan seemed interested in which regulations advance a health and safety requirement. She did not seem to be on the side of residency requirements but she might have been signaling a desire to write a narrow ruling.
John Roberts: He asked just one question, whether the Total attorney was completely in favor of the commerce clause in alcohol cases. The Total attorney was not. None of the attorneys I spoke to would predict how they thought Roberts might vote. If the others split he might be the key.
Neil Gorsuch: "Alcohol has been treated differently in our country's history, for better or worse," he said. He asked that if Total wins this case, would the next case be a question of whether the three-tier system discriminates against out-of-state companies and violates the commerce clause. "Isn't this the camel's nose that peeks under the tent?" he asked. He also suggested that Total's next argument would be for interstate shipping: "Surely that's tomorrow's argument." But he also hectored the other side's attorney, who seemed to concede that the length of Tennessee's residency requirement is too long. "If you concede that much, what's the delta? Where does the commerce clause begin?" Two attorneys I spoke with thought Gorsuch wants to make a broad ruling so the court doesn't have to address similar issues in the future. Personally, I thought the way he spoke about the "Amazon of liquor" meant that broad ruling may not be in favor of interstate shipping.
Clarence Thomas: He took a little nap at the beginning of the hearing, then woke up and fidgeted, and turned away from the case. He appeared to pay attention for less than five minutes of the hour. He voted against winery direct shipping in Granholm, so possibly he didn't feel any of the legal issues were different. Or maybe he was just thinking about lunch.
"I'm usually pretty gloom-and-doom on this stuff," Posner said. "But I don't know how anyone could sit in this court and think it would be a narrow decision. Gorsuch said: 'if you're telling me about residency then we're going to be back in this court in a year'. The bottom line I got is, they were not a fan of the states discriminating. I like our chances."
Filthy government shouldn’t even be involved in these kind of issues.
The 21st amendment makes this a state government issue.
The Framers must be spinning in their graves.
As the Libertarians say, Alcohol, Tobacco & Firearms should be the name of a convenience store.
Government wants a hand in everything and their hands are always dirty.
When did that ever stop the Feds from getting into states business?
Having oral argument in a case involving alcohol regulation on the centennial of the adoption of the 18th Amendment. The Supreme Court showing its sense of humor.
We gots the good stuff here in Napa and Sonoma
Not just Libertarians! I can’t see a reason why commerce and shipping in wine would be different than anything else. I also have bought lots of wine online myself, you just have to have someone over 21 sign to receive it.
The gratuitous slap at Thomas really ruined the article for me. Thomas has long been on record that he thinks oral arguments are a waste of time, and amounts to nothing more than theater. He has only asked a couple of questions over the past few years. When he does participate, it's newsworthy.
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